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As the country awaits the verdict on the Union Budget, what can happen to the markets on budget day?
Indian equities market had been in correction mode from past few weeks. Every time on the day of Budget there has been increase in intraday volatility but the closing isalways important. Events can produce short term spikes or change of trend but that will be only momentarily.
We have always been saying that we should trade objectively and not subjectively and on this day also we would suggest that budget can produce short term volatility but closing will be important.
Our today’s publication of “The Financial Waves” comprises one interesting analysis of Daryl Guppy Moving average method.
Daryl Guppy Moving average method is very interesting to watch. This method uses a cluster of short term moving averages and cluster of long term moving averages.
Nifty: Daryl Guppy View and Elliott Wave Daily chart
We have shown Daryl Guppy Moving average method last time in October when the trend was firmly positive. Currently this method is indicating towards strong negative trend. Daryl Guppy Moving average method is very interesting to watch. This method uses a cluster of short term moving averages and cluster of long term moving averages. Whenever all the short term moving averages move above each and every long term moving average one can initiate long position and whenever each and every short term moving average moves below all long term moving averages, a short can be initiated as it indicates reversal in trend.
Nifty above chart shows that since June 2012 all the short term moving average has managed to stay above all the long term moving averages. Currently we can see a strong reversal and after many months all short term moving averages have almost crossed below the long term averages. This confirms to our Elliott wave counts and the trend remains negative as per Daryl Guppy method.
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